The 2 hottest states to buy property in right now — and 3 where home price appreciation is being crippled by soaring insurance costs

• US home prices rebounded 4% in the last 12 months, per Redfin data.
• But New York and Connecticut outpaced the national average, with 7% and 11.3% gains, respectively.
• Climate resilience is one reason BiggerPockets' Dave Meyer likes the two markets going forward.

After their 5% pullback in the second half of 2022, US home prices have rebounded steadily. Over the last 12 months, they've climbed 4%, according to Redfin data.

But some markets are hotter than others, and BiggerPockets' housing market guru Dave Meyer says home price appreciation in two states in particular are catching his eye at the moment: New York and Connecticut.

Appreciation in the two states is indeed outpacing the national average of 4%, Redfin data shows. In New York, prices are up 7% year-over-year while Connecticut's home prices have risen 11.3% over the last 12 months.

In New York, Meyer pointed specifically to home price growth in the western part of the state in cities like Rochester, Buffalo, and Syracuse. While prices in the cities have been fairly volatile in recent years, since February 2023, home values have risen by 48% in Rochester and Syracuse and 35% in Buffalo. That crushes the 14% national average over that timeline, according to Redfin data.

While Meyer said it's difficult to predict whether these states will continue outperforming in the future, he said he likes their prospects over a 10-to-20-year time horizon.

Part of Meyer's bullishness stems from the fact that Connecticut and western New York are fairly insulated from the impacts of the climate crisis relative to other states, especially those in the south with more exposure to heat and severe storms.

Plus, he's skeptical that the migration from Northeastern and West Coast cities to southern states during the pandemic can keep going. Areas like western New York and the Midwest have excess infrastructure, he said, while places like Florida have struggled with the influx of people.

3 states where appreciation is being stifled

While New York and Connecticut might be among the areas less vulnerable to the climate crisis going forward, states in the south are more likely to be impacted.

Three states that are particularly susceptible to more extreme weather are Florida, Texas, and Louisiana, and home values feeling the brunt of this reality, Meyer said.

That's because of expensive insurance premiums, Meyer said.

"Major carriers are pulling out of the market, and for many homeowners, the premiums are just unaffordable," he told Business Insider.

The numbers back up Meyer's argument. Home price growth over the last 12 months was 2.3% in Florida, -1.1% in Texas, and 2.2% in Louisiana, according to Redfin data. Again, the national average was 4% growth over the last 12 months.

On the insurance premiums front, the data is also there. According to Bankrate , the national average premium is $2,270 per year for a $300,000 home. But in Florida, the average is $5,531 per year; in Louisiana, it's $4,296; and in Texas, it's $3,898. In New York and Connecticut, by comparison, annual average premiums are $1,733 and $1,698, respectively.

A recent study from Bankrate found that average annual premiums in Miami are the highest in the country at $10,473.

Some housing economists and investors are starting to warn of the impacts of climate change on property values.

DeltaTerra Capital CEO David Burt recently told Business Insider that home values in higher-risk areas could drop by 60% thanks to higher insurance premiums eating into homebuyers' budgets.

Skylar Olsen , Zillow's chief economist, is also warning of trouble ahead for home prices in coastal areas of states like Florida and Texas.

"There are large swaths of communities in Florida at risk from storm surge," she told Business Insider in March. "I would not recommend, from an investment perspective, to invest in areas that will be at risk."